NationNews
  • e-paper
    • e-paper
    • e-magazines
  • News
  • Regional
  • Elections
  • Sports
  • World
  • Entertainment
  • classifieds
  • Multimedia
    • Multimedia
    • Podcasts
  • all sections
    • Business
    • Life Style
    • Family Notices
    • Commentary
    • Ticketnation
    • RSS
    • e-publications
    • Politics
    • Contact US
    • Smart Homes
    • Workbook
    • Feature: Owen S Arthur
  • Print Subscription
    • e-paper
      • e-paper
      • e-magazines
    • News
    • Regional
    • Elections
    • Sports
    • World
    • Entertainment
    • classifieds
    • Multimedia
      • Multimedia
      • Podcasts
    • all sections
      • Business
      • Life Style
      • Family Notices
      • Commentary
      • Ticketnation
      • RSS
      • e-publications
      • Politics
      • Contact US
      • Smart Homes
      • Workbook
      • Feature: Owen S Arthur
    • Print Subscription
Government
Business
 on November 6, 2016

Government debt ‘worrisome’

Article by Shawn Cumberbatch 

BARBADOS’ GOVERNMENT DEBT is proving too bitter a pill for a leading investment firm to swallow.

Royal Fidelity Merchant Bank & Trust Ltd. manages a $100 million portfolio in Barbados.

While it is looking to attract new investors and find new investment opportunities, vice-president and country head Jillian Nunes said Royal Fidelity remained “very cautious” about Government debt.

She made this clear recently while participating in an annual investment conference held by actuarial consulting firm Eckler at the Lloyd Erskine Sandiford Centre.

Royal Fidelity has been operating here since 2008, and Nunes said its Premium Income Fund “continues to be one of the better performing funds…on the market”.

However, she explained that although this fund produced a 5.36 per cent return on investment last year, and was on course to repeat that performance this year, Government debt was still a major concern.

“Barbados’ debt rating continues to deteriorate and it stands precariously at CAA1 according to Moody’s. We maintain that there is great need for the Government to align revenues and expenditures [and] reduce debt. That has to be the number one priority,” she said.

“The interest expenses on [Government] debt accounts for 26 per cent of our revenues, so that’s a high number and it’s quite unsustainable.

“We remain very cautious as it comes to Government debt.”

Nunes said there was “high liquidity” in the market, but noted that the rate of interest banks paid on savings accounts was now at an all-time low and “trending towards zero”.

“So what we are seeing is a steady stream of investments into this [Premium Income Fund] and so we continue to manage the high level of incoming cash and that remains a challenge with limited new corporate issues coming to market,” she added.

“What that means is that in the short term we might end up with a high concentration of cash holdings or a particular security that we would have added to the fund.”

The fund has 39 per cent of its investments in statutory corporations including the Barbados Port Inc., 25 per cent in United States securities, 20 per cent in direct Government issues, 13 per cent in corporate investments and three per cent is cash. (SC)

Comments are closed.

Cartoon
Facebook
@ Follow me
Tweets
Site Index
  • Home
  • News
  • Business
  • Sports
  • Commentary
  • Entertainment
  • Lifestyle
  • Regional
  • World
  • E-Paper
  • Multimedia
  • Blogs
  • Home
  • News
  • Business
  • Sports
  • Commentary
  • Entertainment
  • Lifestyle
  • Regional
  • World
  • E-Paper
  • Multimedia
  • Blogs
Services
For information about this website or content published please contact the Webmaster or Online Editor, respectively. Regarding press releases please contact the News Room.
Subscribe
Subscribe to NationNews with our Webfeed. Follow us on Facebook and Twitter.
General Info
  • Home
  • News
  • Business
  • Sports
  • Commentary
  • Entertainment
  • Lifestyle
  • Regional
  • World
  • E-Paper
  • Multimedia
  • Blogs
  • Home
  • News
  • Business
  • Sports
  • Commentary
  • Entertainment
  • Lifestyle
  • Regional
  • World
  • E-Paper
  • Multimedia
  • Blogs
Legal
Copyright © 1997 - , Nation Publishing Co. Limited • P.O. Box 1203, Fontabelle, St. Michael, BB11000, Barbados, West Indies • All Rights Reserved No unauthorized use is permitted of content produced by NationNews.com, The Nation Newspaper or any other publication or media owned by Nation Publishing Co. Limited. Unauthorized use includes framing and direct posting of content on websites other than www.nationnews.com.